Asia-Pacific Competition Update November 2015, Issue 15 CompetitionCompetition PProgrammerogramramme OECDOECD KOREAKOREA PolicyPoliclicyy CentreCentntrtrere Asia-Pacific Competition Update IN THIS ISSUE EntryEntrryy pointpoint - EditorialEdE Note p. 3 NewsNewsws from Asia-Pacific Competition Authorities p. 4-6 WorkshopWorWorkrkkssshop on TelecommunicationsTeT and ICT Sectors p. 7-12 WorkshopWorkrks for Judges – The Use of Competition Economics p. 13-15 OECDOECDCD CompetitionCompetiCompetiiti Committee Meetings p. 16-18 Calendar of Events 2016 p. 19 The Competition Programme of the OECD/Korea Policy Centre provides education and training to officials of Asia-Pacific competition authorities in the field of competition law and policy. This newsletter includes information about our work and the work of the OECD, as well as news, case studies and reports from competition authorities in the Asia-Pacific region. A publication of the OECD/Korea Policy Centre Competition Programme. The Asia-Pacific Competition Update may be reproduced with appropriate source attribution. This Newsletter is provided for information purposes only. The views expressed do not necessarily represent the views of the OECD or the Korea Policy Centre. To subscribe, or cease subscribing to Asia-Pacific Competition Update, please send an email with your contact details to [email protected]. Further information about the Competition Programme at the OECD/Korea Policy Centre can be found at www.oecdkorea.org and www.oecd.org/competition/seoulrcc. Asia-Pacific Competition Update Reaching out towards the last month of another great year officials, the other a workshop for judges from the Region at the OECD-Korean Policy Centre Competition Programme, on the use of economics in abuse of dominance and merger it’s also a full year now since I have had the opportunity to be cases. The latter workshop, will have a continuation in 2016, responsible for the Programme from the OECD-side. As a kind as next year’s workshop for judges will be devoted to the use of personal balance, I believe it has been a very successful of economics in horizontal and vertical agreements as well as year, where I have learnt a lot from speakers and participants in damage claims. alike. I hope I have also effectively shared some of my More immediately, in December we will hold an event in experience and the OECD work with nearly 200 participants the beautiful Jeju Island, in a seminar that will be chaired this year. by Sabine Zigelski, my colleague who normally heads the The first piece of news I would like to share is that the equivalent programme in Budapest mainly for the Eastern Programme for 2016 has now been approved and been European countries. The topic will be on remedies and settled upon. You may read it in them pages of this newsletter. commitments. For now I would like to highlight our in-country events that will I look forward to seeing you at one of our upcoming events! take place in a number of different ASEAN countries: Vietnam, Indonesia and in another ASEAN country yet to be confirmed. Ruben Maximiano It is thus a year with an important focus on the ASEAN nations, although of course not exclusively so. The reason for that being that by the end of 2015 all (or at least the vast majority) of the ASEAN nations will have approved Competition Laws. The advantage of doing such in-country events is that a greater number of officials of the agencies of the economy where the seminar takes place can participate. It is also therefore a great opportunity for those agencies to broaden internally their know-how and knowledge, making the most of top world class experts in a particular field provided by the OECD-KPC. In all our events there are always, of course, many other participants from across the Asian-Pacific Region. This edition also provides a detailed insight on the two events held since the last newsletter, both of which took place in Korea. One dedicated to the ICT sector that counted with a great mix between telecoms regulators and competition 3 News from Asia-Pacific Competition Authorities News from Asia-Pacific Competition Authorities* * News items were provided by respective Competition Authorities. DG Competition of the EU and MOFCOM sign best practices for cooperation in mergers On 15 October 2015, the People's Republic of China MOFCOM and DG Competition of the European Commission signed a practical guidance document creating a dedicated framework to strengthen cooperation and coordination in their review of mergers. The guidance will facilitate communication and information exchanges throughout the entire merger review procedure on issues of procedure and substance, including the definition of relevant markets, theories of harm, competitive impact assessments and remedies when both authorities review the same transaction. The current arrangement follows on from the a Terms of References on the EU-China Competition Policy Dialogue with MOFCOM in 2004, and adds a further level of cooperation. CTFTC hosts seminar in Malaysia with MyCC The Fair Trade Commission of Chinese Taipei, coordinated with the Malaysia Competition Commission (MyCC), hosted the seminar on “Effective Tools to Combating Cartels and Abuse of Dominance” in Kuala Lumpur, Malaysia on 6-7 October 2015. The seminar was part of the “Regional Capacity Building Program on Competition Policy” held by the CTFTC since 2010 in the Southeast Asia Area to promote competition law and policy in the region. The Seminar was chaired by Dr. Hung-Hao CHANG, Commissioner of the FTC. Honorable Tan Sri Dato’ Seri Siti Norma Yaakob, Chairperson of MyCC, gave her welcome remarks to all participants in the opening ceremony. 26 competition officials from Hong Kong, India, Indonesia, Korea, Malaysia, Mongolia, Singapore, Thailand and Vietnam were invited to attend the event. The seminar also benefited from invited panelists, Mr. Ruben Maximiano, senior competition expert of OECD, Ms. Saiko Nakajima, Chief Investigator for Leniency Program of the Japan Fair Trade Commission, and Prof. Dr. R. Ian McEwin, Khazanah Nasional Chair of UMCoRS(University of Malaya, Malaysian Centre of Regulatory Studies), Univ. of Malaya, to participate the discussion. 4 Asia-Pacific Competition Update Competition Commission publishes enforcement policy and cartel leniency policy On 19 November, the Hong Kong Competition Commission (HKCC) published the enforcement policy and its Cartel Leniency Policy for Undertakings Engaging in Cartel Conduct (Cartel Leniency Policy), providing further guidance on how the HKCC intends to carry out its enforcement function under the Competition Ordinance scheduled to take full effect on 14 December 2015. These follow the six guidelines published in July 2015. Regarding its enforcement policy the HKCC will prioritise three forms of conduct: 1) “hard-core” cartel conduct which includes price- fixing, market sharing, output restriction and bid-rigging, 2) First Conduct related-agreements that cause significant harm to competition in Hong Kong and 3) exclusionary abuses of substantial market power in markets in Hong Kong. The Cartel Leniency Policy outlines the Commission’s approach to leniency for undertakings engaged in cartel conduct. It is designed to provide a strong and clear incentive for a cartel member to stop the cartel conduct and to report it to the Commission. Leniency will extend to whistleblowers - current officers and employees of the cartel member and specifically named former officers or employees and current and former agents of the cartel member who cooperate with the Commission. KFTC amends guidelines on unfair practices rules In November, the KFTC prepared an amendment to the Guidelines for Assessment of Unfair Trade Practices and issued a prior administrative notice thereof. The proposed amended the Guidelines by further specifying criteria for assessing anti-competitive effect of unfair trade practice types, whose illegality is assessed mainly based on whether such unfair practices restrict competition. Such unfair trade practice types include refusal to deal, discrimination, exclusion of competitor, binding and conditional trade. For example, illegality of tie-in sales will be assessed mainly based on their anti-competitive effect. The following are major enforcement cases handled by the Korea Fair Trade Commission during the second half of 2015. In August, the KFTC cleared the way for the acquisition plan where Microsoft (hereinafter “MS”) acquires the devices and service business of Nokia (hereinafter the “Acquisition”), accepting the consent decree that prevents the possibility of MS’s abusing the patent rights at its source. The consent decree is expected to address the competition concerns that MS, while engaging in the handset business, might unilaterally raise the royalties or bring patent infringement lawsuits against its competitors to obstruct their businesses. Also in August, the KFTC decided to impose remedies against Dolby[Dolby Laboratories Licensing Corporation (American corporation) and Dolby International AB (Swedish corporation)], a global company that owns standard audio technologies, for setting out unfair contract terms in its license agreement such as no-challenge clauses. The KFTC Imposed orders to cease the violation of law that puts the transacting partner at a disadvantage by setting out and maintaining unfair contract terms. As for the already-signed license agreements, the KFTC ordered modification or elimination of the clauses concerned. The KFTC decided not to impose fines considering